/raid1/www/Hosts/bankrupt/CAR_Public/000605.MBX                  C L A S S   A C T I O N   R E P O R T E R

                  Monday, June 5, 2000, Vol. 2, No. 108


ALBERT: $300 Mil Lawsuit over Untreated Pine Shakes Thrown out
AUTO INSURANCE: Insurance Customers Sue CCC Information over Valuation
BP AMOCO: Discloses Chem-Lab Risks and Fends off Would-Be Lawsuit
COMMERCIAL FINANCIAL: Bankruptcy Ct Considers Pay to Laid Off Workers
CONDOR TECHNOLOGY: Allegations in MD over Y2K Dismissed within Months

CYBER-CARE, INC: Gilman and Pastor Files Securities Suit in Florida
GTE CORPORATION: Milberg Weiss Files Securities Lawsuit in NY
GUN MAKERS: PA Joins Communities Dropping Suits Against Smith & Wesson
HOLOCAUST VICTIMS: Talks Fail to Resolve Legal Wrangle; Resumes June 12
INMATES LITIGATION: WI Has Authority to Send Inmates out, Ap Ct Rules

KAISER ALUMINIUM: Faces a Number of Asbestos-related Lawsuits
KAISER ALUMINIUM: Plaintiffs Want Gramercy Explosion Suits in LA State
MATTEL INC: Emerges from Stockholder Suit over Old Learning Merger
MATTEL INC: Stockholders File Suits in CA and DE over Mismanagement
MATTEL INC: Stockholders Sue upon Announcement of Earnings Shortfall

PHONE FIRMS: Off the Hook on Chicago Telecom. Tax Suit Seeking Refund
POTASH CORP: 8th Cir Reverses Antitrust Claims in Conscious Parallelism
SECRET SERVICE: Black Agents Claim Retaliation for Racism Lawsuit
TOBACCO LITIGATION: Judge Warns against Dawdle; Fed Suit Moves Forward
W.R. GRACE: Agrees to Settle MD Plant Workplace Sexual Harassment Suit


ALBERT: $300 Mil Lawsuit over Untreated Pine Shakes Thrown out
An Edmonton judge has thrown out a $300-million class-action lawsuit
against the Alberta government over its approval of untreated pine shakes.
Justice Mel Binder of Court of Queen's Bench dismissed the lawsuit saying
it cannot proceed as a class action. The Alberta Pine Shake Homeowners
Association had gone after the province over thousands of cases of rotting
roof shakes, claiming it knew the roofing material was faulty, but approved
it anyway. (The Toronto Star, June 2, 2000)

AUTO INSURANCE: Insurance Customers Sue CCC Information over Valuation
On January 31, 2000, a putative class action lawsuit was filed against CCC
Information Services Group Inc., Dairyland Insurance Co., and Sentry
Insurance Company. Susanna Cook v. Dairyland Ins. Co., Sentry Ins. and CCC
Information Services, Inc., No. 2000 L-1 (Circuit Court of Johnson County,
Illinois). Plaintiff alleges that her insurance company, using the
Company's TOTAL LOSS product, offered an inadequate amount for her
automobile. Plaintiff seeks to represent a nationwide class of all
insurance customers who, during the period from January 28, 1989 up to the
date of trial, had their total loss claims settled using a valuation report
prepared by CCC. The complaint also seeks certification of a defendant
class consisting of all insurance companies who used the Company's
valuation reports to determine the "actual cash value" of totaled vehicles.
Plaintiff asserts various common law and contract claims against the
defendant insurance companies, and various common law claims against CCC.
Plaintiff seeks an unspecified amount of compensatory and punitive damages,
as well as an award of attorneys' fees and costs.

The above action follows the filing of several other putative class
actions, which name only CCC and individual insurance companies. Those
actions, each of which was filed by the same plaintiffs' attorney in the
Circuit Court of Cook County, Illinois, are captioned as follows:

    * Alvarez-Flores V. American Financial Group, Inc., Atlanta Casualty
      And Ccc Information Services, Inc., No. 99 Ch 15032 (Filed 10/19/99);

      Gibson V. Orion Auto, Guaranty National Ins. Co. And Ccc Information
      Services, Inc., No. 99 Ch 15082 (Filed 10/20/99);

    * Keiller V. Farmers Insurance Group Of Companies, Farmers Group, Inc.,

      Farmers Insurance Exchange, Farmers Insurance Co. Of Oregon, And Ccc
      Information Services, Inc., No. 99 Ch 15485 (Filed 10/27/99);

    * Stephens V. The Progressive Corp., Progressive Preferred Ins. Co. and
      Information Services, Inc., No. 99 Ch 15557 (10/28/99);

    * Myers V. Travelers Property Casualty Corp., The Travelers Indemnity
      Company of America, And CCC Information Services, Inc., No. 00 Ch
      (Filed 2/22/00).

In the Cook County cases, plaintiffs allege that their individual insurance
companies, using CCC's TOTAL LOSS valuation product, offered plaintiffs an
inadequate amount for their automobiles. The plaintiffs further allege that
CCC's TOTAL LOSS product does not provide fair, accurate values for used
vehicles. The plaintiffs assert various common law and statutory claims
against CCC and the individual insurers. In each case, plaintiffs seek to
represent a class of customers who made a total loss claim for which their
individual insurer defendant used a valuation report by CCC, and who
allegedly did not receive the market value of their automobile. Plaintiffs
seek unspecified compensatory and punitive damages and an award of
attorneys' fees and expenses. Certain of the insurance company defendants
have filed preliminary motions to dismiss plaintiffs' claims and/or to
compel appraisals. Those motions are currently pending.

BP AMOCO: Discloses Chem-Lab Risks and Fends off Would-Be Lawsuit
It's the summer of 1999, and the company was being sued by the families of
six scientists stricken with a rare form of brain cancer. All were
diagnosed soon after retiring from long careers at BP Amoco's chemical
research lab in Naperville, Ill., and five were already dead. Because BP
Amoco is so big and rich -- sales topped $ 100 billion in 1999 -- a jury
might see Robin Hood justice in socking your company with damages that
rival a Lotto jackpot. Then there was this bombshell: The outside medical
experts concluded the brain-cancer cluster was probably work-related.

H. Laurence Fuller, co-chairman of BP Amoco PLC. called a press conference
and disclosed everything.

According to the Business Week, many corporate lawyers would have advised
Fuller that his was the dumbest move imaginable, but BP Amoco is proving
that when it comes to workplace liabilities, honesty is the best policy. By
taking the moral high ground, the company deftly upstaged its foes in the
court of public opinion, denying them a chance to turn it into another
corporate ogre. Now, it is casting itself in the same sympathetic role in a
court of law. The company won dismissal last year of a would-be class
action. In March, the families of five of the chemists with brain cancer
dropped their lawsuits for cash settlements, one for as high as $ 2.7
million. ''Other defendants allow themselves to be put on the defensive,''
says Victor E. Schwartz, a senior partner at the Washington law firm
Crowell & Moring. ''BP Amoco broke the vilification.''

Candor, however, doesn't come cheap or guarantee absolution, the Business
Week remarks. BP Amoco spent millions to hire top-flight medical
investigators and specialists and millions more on the recent settlements.
Although widespread reports about the mysterious cancers did nothing to
hinder British Petroleum Co.'s takeover of Amoco Corp. in 1998, the
company's labs, once acclaimed for breakthroughs in polymer research, are
today known by potential recruits as causing cancer. Undoubtedly, the
company would have suffered regardless of its response. But by
stonewalling, it would have lost any chance to mold its image with the

Frankness has not stopped BP Amoco from getting sued either, the article
goes on. In fact, the company may have turned itself into something of a
litigation magnet by releasing such incriminating findings. Even with the
March settlements, BP Amoco stands accused by an additional two dozen
plaintiffs with a variety of seemingly unrelated tumors. But the payoffs
will continue if these suits go to trial. After learning of the
research-center cancers, BP Amoco shuttered the lab, offered free MRIs to
employees, and hired medical experts to comb through medical records of all
1,676 people who had been employed at the ''cancer building.'' Since the
company has owned up to its responsibilities, perhaps the public will think
there's less need to slap it with exorbitant damages. That means if BP
Amoco loses, it could end up paying less in compensatory and punitive
damages, say outside lawyers. Notes Thomas Donaldson, a business professor
at the Wharton School and director of its ethics program: ''It seems to me
that a company that shows it has heart is going to get a better hearing
when it comes to the jury box.''

The Business Week says that despite so much to gain by going public, many
companies do not choose to come clean because corporate lawyers generally
instruct clients to hunker down and deny everything. That rote advice does
have some logic. Without evidence, plaintiffs may not be able to even bring
a case, let alone prove it in court. If no one else knows, they figure, the
problem will eventually go away, and the company will have saved itself a
public tarring and big-time legal fees.

But as corporate defendants are learning, it is harder and harder to keep
secrets today. Bad news can spread on the Internet or a 24-hour cable
channel faster than ever before. Once the word gets out, it's usually too
late. That's because the act of covering up is criminal in and of itself.
''You could try to hide it, and you might get away with it 5 times out of
10, or even 9 times out of 10, but the risk of getting caught even that one
time would be severe,'' observes David E. Van Zandt, dean of Northwestern
University's law school. ''You look like a bad actor.''

So far, BP Amoco seems to be avoiding that fate. One of its smartest moves
was to hire researchers from Johns Hopkins University and the University of
Alabama at Birmingham to construct medical histories of everyone who had
ever worked in the Naperville lab. The goal: to uncover an on-the-job link
between those with the rare and fatal brain tumors, called gliomas, and the
thousands of chemicals the scientists handled since the labs opened in
1970. In the end, the researchers failed to identify a chemical or a
combination of chemicals responsible for the cancers. But they found that
all six of the cancer victims were white men, assigned to the same building
wing at some point in their careers, who had worked at the center for at
least 10 years. The glioma rate among this group was 12 times as high as in
a normal population, suggesting the cluster was related to something in the

That BP Amoco gets credit for this rankles some plaintiffs' lawyers. They
dismiss the study as little more than a publicity stunt crafted to make BP
Amoco seem like a good guy. ''That's not exactly a news flash -- everyone
already knew there were too many gliomas,'' says Tilden Katz of Corboy &
Demetrio, a Chicago law firm representing 16 plaintiffs, including the
sixth researcher found with brain cancer.

Still, it's hard to argue that BP Amoco didn't do the right thing. Marios
N. Karayannis, a partner at Brady & Jensen in Elgin, Ill., sued BP Amoco on
behalf of six people who claim they got cancer by working at the lab,
including his father, Nicholas, who died in February, 1998. Karayannis
settled his father's suit on Mar. 21 for an undisclosed sum. The workplace
probably killed his dad, he says. But he adds: ''My father enjoyed working
there. Becoming bitter would not honor his time there.'' What company
wouldn't want to be regarded like that? (The Business Week, June 5, 2000)

COMMERCIAL FINANCIAL: Bankruptcy Ct Considers Pay to Laid Off Workers
A federal bankruptcy judge has taken under advisement a proposal by
attorneys for Commercial Financial Services Inc., its creditors and
bondholders to give a week's worth of pay to 1,367 workers laid off between
Jan. 8, 1999, and Feb. 8, 1999.

Attorneys made the offer in U.S. bankruptcy court. In exchange for the pay,
less taxes, the former workers would sign a release promising not to sue
over their layoffs from the now-defunct debt collection company. "This
settlement will make a lot of claims go away," said CFS attorney Larry
Wolfson. "We won't know how many until we give them the opportunity."

Attorneys representing a group of workers in a class-action lawsuit against
CFS argued against the proposal. Attorney Michael McCune described the
offer as an attempt by CFS to circumvent the class-action lawsuit.

Attorney Jed Penny said the offer might be the equivalent of having workers
"halfway opting out" of the lawsuit. He said there was no need for workers
to take the settlement and drop out of the lawsuit. "Is the acceptance of a
settlement offer opting out?" he said. "I think that settlement is opting

The proposal is similar to one the bankruptcy court approved last summer.
CFS spent more than $2.2 million to stave off lawsuits from employees let
go when the company ceased operations. About 98 percent of former employees
took the earlier offer that amounted to two weeks pay for the 1,400 people
let go when the company finally shut down.

The class-action lawsuit pending contends the company violated federal law
on the amount of warning that must be given before a significant layoff of

CFS filed for bankruptcy on Dec. 11, 1998, as a step in trying to keep the
Tulsa-based business open. It ceased operations in June 1999. The company
had more than 3,900 employees in Tulsa and Oklahoma City.

In the hearing, CFS attorney Caroline Benediktson said the former CFS
workers were smart enough to decide whether to take the week's pay
settlement offer or remain in the class-action lawsuit and take a chance on
a payday that could be much greater or zero. Bankruptcy Judge Dana Rasure
said she would rule on the planned offer. (The Associated Press State &
Local Wire, June 1, 2000)

CONDOR TECHNOLOGY: Allegations in MD over Y2K Dismissed within Months
On or about July 1, 1999, an action was commenced against the Company and
its Chief Executive Officer in the United States District Court for the
District of Maryland, captioned Gordon V. Condor Technology Solutions,
Inc., Et Al., Civil AMD-99-1952. The plaintiff purported to bring the
action on behalf of a class consisting of all persons (other than the
defendants and their affiliates) who purchased Common Stock in the Company
between February 3, 1999 and June 8, 1999. The plaintiff contended that,
during the Alleged Class Period, the defendants made false and misleading
statements about the future impact of the "Year 2000" issue on the
Company's business and on the concentration of the Company's business with
certain customers. The Company believes that the statements challenged by
the plaintiff were accurate, and that the plaintiff's allegations of
wrongdoing were baseless. On November 4, 1999, the Court issued an Order
dismissing the class action lawsuit against the Company and its officer.

CYBER-CARE, INC: Gilman and Pastor Files Securities Suit in Florida
Gilman and Pastor, LLP has filed a securities class action lawsuit in the
United States Court for the Southern District of Florida against CyberCare,
Inc. (NasdaqNM: CYBR) and certain officers and directors of the Company on
behalf of purchasers of CyberCare common stock during the period October
12, 1999 through May 19, 2000, inclusive (the "Class Period").

Plaintiff's complaint alleges that defendants violated the federal
securities laws by issuing a series of false and misleading statements to
the investing public concerning the business and financial operations of
CyberCare. In particular, defendants misrepresented that CyberCare's
Electronic Housecall ("EHC") system was "market-ready" and that the Company
had received hundreds of thousands of orders for the product, when in fact,
the FDA had not yet approved the EHC system for marketing or sale, any
agreement to sell the system would violate FDA regulations prior to
approval, and demand for EHC system consisted mainly of vague expressions
of interest by entities that lacked the wherewithal to acquire the system.
These misstatements are alleged to have inflated the price of CyberCare
common stock purchased by investors during the Class Period.

Contact: Peter Lagorio of Gilman and Pastor, LLP, 617-589-3750,

GTE CORPORATION: Milberg Weiss Files Securities Lawsuit in NY
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a
class action lawsuit was filed on June 1, 2000, on behalf of shareholders
of GTE Corporation ( "GTE" or the "Company") (NYSE:GTE) who held GTE common
stock on March 29, 2000. A copy of the complaint filed in this action is
available from the Court, or can be viewed on Milberg Weiss' Web site at:

The action, numbered 00CIV4117, is pending in the United States District
Court for the Southern District of New York, located at 500 Pearl Street,
New York, N.Y., against defendants Charles Lee, Edwin Artzt, James Barker,
Edward Budd, Robert Daniell, Kent Foster, James Johnson, Richard Jones,
James Ketelsen, Michael Masin, Sandra Moose, Russell Palmer, Robert Storey,
who collectively constitute GTE's board of directors, and GTE. The
Honorable Harold J. Baer is the Judge presiding over the case.

The complaint charges that defendants violated Sections 14(a) and 20(a) of
the Securities Exchange Act of 1934, and Rule 14a-9 promulgated thereunder,
by disseminating a materially false and misleading proxy statement (the
"Proxy Statement"). In connection with seeking shareholder approval of a
merger between GTE and Bell Atlantic, defendants disseminated a Proxy
Statement representing that the dividend of the post merger entity will be
nearly identical to the current dividend of GTE. This statement was false
when made because the post merger entity will release quarterly dividends
one month later than GTE's customary dividend releases. Because of the over
one billion outstanding shares of GTE, the one month delay will result in a
material loss of the time value of the dividends.

Contact: Milberg Weiss Bershad Hynes & Lerach, New York Steven G. Schulman
or Samuel H. Rudman, 800/320-5081 E-mail: gtecase@milbergny.com

GUN MAKERS: PA Joins Communities Dropping Suits Against Smith & Wesson
U.S. Housing Secretary Andrew Cuomo and Mayor John Street on June 2
announced that Philadelphia will join 17 local governments that have
dropped lawsuits against Smith & Wesson as a result of a gun safety
agreement the gunmaker signed with the Clinton Administration, states and

The historic agreement, signed in March, requires Smith & Wesson to make
major changes in the design, distribution and marketing of guns to make
them safer and to keep them out of the hands of children and criminals.

"Our agreement with Smith & Wesson will save lives in communities across
America," Secretary Cuomo said. "Philadelphia's decision to join this
agreement is a major step forward that should encourage other gun companies
to join Smith & Wesson to produce safer firearms and to keep guns out of
the wrong hands. Gunmakers should realize that settling lawsuits filed
against them is in their own self-interest as well as the public interest."

Mayor Street said: "This is a watershed moment in the future of gun
manufacturing and in the area of handgun safety. Gun manufacturers must
acknowledge their responsibility to protect the public health and welfare
from the illegal or inappropriate uses of their products. We applaud Smith
& Wesson for its commitment to protect our children from the devastation
caused by guns on our streets."

The March agreement is the product of negotiations between the White House,
the Department of Housing and Urban Development, the Treasury Department
and local governments with Smith & Wesson. The agreement was designed to
settle lawsuits already filed against the gun manufacturer and to make new
lawsuits unnecessary. Key provisions of the agreement require Smith &
Wesson -- the nation's largest handgun manufacturer -- to: 1) Install
mandatory gun locks and other child-safety devices on all guns. 2)
Introduce "smart gun" technology in all newly designed handguns to allow
the guns to be fired only by their owners -- making the guns useless to
children and criminals. 3) Bar gun sales -- including gun show sales --
without a background check of the buyers. 4) Limit multiple handgun sales.
5) Include hidden serial numbers on guns to make them easier for law
enforcement to trace after a crime. 6) Refrain from marketing guns in ways
that appeal to children or criminals. 7) Establish a trust fund to
implement a public service campaign to inform people about the risk of
firearms in the home, proper home storage, the importance of proper gun
disposal, and the need to reduce gun violence.

The goal of the agreement is to reduce the toll of gun violence, which each
year claims more than 30,000 lives and injures another 100,000 people in
crimes, accidents and suicides around the United States.

Gun violence is a major problem in the nation's public housing
developments, which are often located in neighborhoods with the highest
crime rate in a community. According to recent HUD study, residents of
public housing are more than twice as likely to suffer a firearm-related
incident as compared to non-residents. About 3 million low-income people
live in public housing.

In response to the Smith & Wesson agreement, officials from more than 411
state and local governments around the nation have joined the Communities
for Safer Guns Coalition. Officials in the Coalition sign a pledge saying
they support giving favorable consideration to making purchases from gun
manufacturers that have adopted gun safety and dealer responsibility
standards. The preference applies to comparable weapons available at a
comparable price that meet law enforcement agency needs.

A purchase preference by governments for guns that meet certain standards
can act as an incentive to manufacturers to adopt those standards -- much
as the demand for certain types of cars by motorists prompts auto makers to
make more such vehicles.

Cuomo pointed out that incidents of gun violence in the last few days
illustrate the need for other gunmakers to reform their practices. These
incidents include: 1) The shooting of a teacher in Lake Worth, FL by a
student. If the gun the boy stole from his grandfather had a trigger lock,
the tragedy might have been averted. 2) In a public housing development in
Chicago, a 12-year-old and his 14-year-old brother were playing with a gun
in a hallway, and the 12-year-old was fatally shot. Again, a trigger lock
might have made a difference. 3) In Montclair, NJ, authorities uncovered a
scheme where two juveniles were buying semiautomatic handguns over the
Internet. They passed themselves off as licensed gun dealers using forged
federal firearms licenses.

HUD and the Treasury Department entered the negotiations with Smith &
Wesson after President Clinton said his Administration could support a
class action lawsuit by the nation's 3,200 public housing authorities that
would be designed to reduce gun violence in public housing and nearby
areas. A commission made up of two representatives from local governments,
one from states, one from Smith & Wesson and one selected by the U.S.
Bureau of Alcohol, Tobacco and Firearms will oversee the agreement with
Smith & Wesson.

The U.S. government will require any additional gun manufacturers joining
in the agreement to meet the requirements set for Smith & Wesson, along
with additional safety and distribution measures. Guns manufactured and
sold to the military and law enforcement agencies will be granted an
exception to the safety features mandated by the new agreement, if the
military or law enforcement agencies certify the need.

             Clinton Administration's Gun Safety Agenda

In addition to the landmark gun safety agreement reached with Smith &
Wesson, other parts of the Clinton Administration's gun safety agenda

A $280 million national firearms enforcement initiative that is part of the
President's proposed budget. The initiative would hire 500 new Bureau of
Alcohol, Tobacco and Firearms agents and inspectors to target gun
criminals; hire more than 1,000 prosecutors at all levels of government;
fund expanded crime gun tracing and ballistics imaging systems to catch
more gun criminals; fund local media campaigns to discourage gun violence;
and expand the development of "smart gun" technologies.

A $30 million Community Gun Safety and Violence Reduction Initiative that
President Clinton proposed in his Fiscal Year 2001 Budget. The initiative,
which would be administered by HUD, would fund computerized mapping of gun
violence to help law enforcement agencies better protect the public,
education and outreach programs to promote responsible safety measures by
gun owners, and innovative community activities to reduce both gun crimes
and accidents. Under this initiative, local governments, law enforcement
agencies, public housing authorities, community organizations, and other
groups would be eligible to compete for HUD grants to support gun violence
reduction activities in the communities the Department serves. Last week, a
House committee rejected funding for this program.

Gun buyback programs around the nation funded by HUD. So far this year more
than 14,000 guns have been collected in 55 cities, with more than 30 gun
buybacks planned in the coming months.

HOLOCAUST VICTIMS: Talks Fail to Resolve Legal Wrangle; Resumes June 12
U.S. and German negotiators said last Friday June 2 they had again failed
to resolve a legal wrangle that could delay plans to pay billions of
dollars in compensation to survivors of Nazi-era slave and forced labour

The chief American and German negotiators - U.S. Deputy Treasury Secretary
Stuart Eizenstat and Berlin's Otto Graf Lambsdorff - said at a press
conference that while progress had been made, the two sides would have to
meet again in Washington on June 12. "This must then be the time we reach
final results," said Lambsdorff, adding that all parties involved in the
talks were confident the remaining problems could be resolved.

German insistence on iron-clad guarantees that its companies won't face
further lawsuits in U.S. courts scuppered hopes that a final deal could be
signed by German Chancellor Gerhard Schroeder and U.S. President Bill
Clinton who is currently visiting Germany. Last year the German government
and business leaders each agreed to fund half of a 10 billion mark (4.7
billion dollar) compensation fund for ex-Nazi slaves. So far German
industry has pledged three billion marks. Manfred Gentz, the
DaimlerChrysler executive who represents German business in the talks, says
agreement on an accord protecting industry from further class action suits
would likely unleash more donation pledges.

Negotiations have dragged on for over a year and the latest failure could
jeopardise German government plans to begin payments to the one million
eligible forced labourers and over 200,000 death camp slave labour
survivors before the end of the year.

Many of ex-slave labourers are now U.S. citizens, while most of the forced
labourers to be compensated come from Eastern Europe. Eligible claimants
will receive up to 15,000 marks (7,256 dollars) each. (Deutsche
Presse-Agentur, June 2, 2000)

INMATES LITIGATION: WI Has Authority to Send Inmates out, Ap Ct Rules
A circuit court erred when it ruled the state Department of Corrections
lacks the authority to transfer inmates to out-of-state private prisons, a
state appeals court ruled. The 4th District Court of Appeals ruled that
unless the inmates can show that conditions at out-of-state prisons are
more restrictive than those in any state prison, there is no basis for
their claim that they have a legally enforceable interest not to be
transferred outside Wisconsin.

The appeals court also rejected the argument made by the four inmates who
filed the lawsuit that because state statutes do not expressly grant
transfer authority separate from the state's authority to contract with
out-of-state prison that the Legislature intended to prevent the department
from transferring prisoners out of state.

To alleviate congestion in Wisconsin prisons, the department rents space in
several states for about 3,500 convicts. Other state statutes that permit
the Corrections Department to contract with local governments to hold state
prisoners in county jails are interpreted to include the authority to
transfer inmates to those jails, the appeals court said.

Circuit Judge Moria Krueger had ordered the department not to transfer the
two inmates who were still in Wisconsin prisons and to return two others
who were being held in out-of-state prisons.

June 1's decision orders the Dane County Circuit Court to dismiss the
lawsuit. The judge specified that the lawsuit was not a class action and
her order would apply only to the four inmates involved in the case, not to
all of the several thousand prisoners serving time in out-of-state cells.

Two of the inmates, William Evers and Barry Smalley, are serving their
sentences at a state prison in Oshkosh. Clifford Ferguson is housed at the
Comanche County Jail in Texas and Roger Vander Logt is serving his sentence
at a private prison at Whiteville, Tenn.

Wisconsin has been sued in state and federal court in at least 25 other
instances by inmates who object to imprisonment in other states and has won
each time, state attorneys said. (The Associated Press State & Local Wire,
June 1, 2000)

KAISER ALUMINIUM: Faces a Number of Asbestos-related Lawsuits
Kaiser Aluminium and Chemical Corporation is a defendant in a number of
lawsuits, some of which involve claims of multiple persons, in which the
plaintiffs allege that certain of their injuries were caused by, among
other things, exposure to asbestos during, and as a result of, their
employment or association with KACC or exposure to products containing
asbestos produced or sold by KACC.

KAISER ALUMINIUM: Plaintiffs Want Gramercy Explosion Suits in LA State
On July 5, 1999, Kaiser Aluminium and Chemical Corporationís Gramercy,
Louisiana, alumina refinery was extensively damaged by an explosion in the
digestion area of the plant. The cause of the accident is under
investigation by KACC and various governmental agencies. In January 2000,
the U.S. Mine Safety and Health Administration issued 21 citations and in
March 2000 proposed KACC be assessed a penalty of $.5 million in connection
with its investigation of the Gramercy incident. The citations allege,
among other things, that certain aspects of the plant's operations were
unsafe and that such mode of operation contributed to the explosion. KACC
has previously announced that it disagrees with the substance of the
citations and has challenged them and the associated penalty. It is
possible that other civil or criminal fines or penalties could be levied
against KACC.

Twenty-four employees were injured in the incident, several of them
severely. KACC may be liable for claims relating to the injured employees.

The incident has also resulted in more than thirty-five lawsuits, most of
which were styled as class action suits, being filed against KACC on behalf
of more than 13,000 claimants. The lawsuits allege, among other things,
property damage and personal injury. Such lawsuits were initially filed, on
dates ranging from July 5, 1999, through December 26, 1999, in the Fortieth
Judicial District Court for the Parish of St. John the Baptist, State of
Louisiana, or in the Twenty-Third Judicial District Court for the Parish of
St. James, State of Louisiana, and such lawsuits have been removed to the
United States District Court, Eastern District of Louisiana, and are
consolidated under the caption Carl Bell. et al. V. Kaiser Aluminum &
Chemical Corporation, No. 99-2078, et.seq.

Plaintiffs have filed motions to remand the actions to state court, and the
federal court has taken the matter under advisement. The cases are
currently stayed pending mediation between the parties. The aggregate
amount of damages sought in the lawsuits cannot be determined at this time.

MATTEL INC: Emerges from Stockholder Suit over Old Learning Merger
On December 16, 21, and 23, 1998, several stockholders of the legal entity
The Learning Company, Inc. that merged into Mattel ("Old Learning Company")
filed six separate purported class action complaints in the Court of
Chancery of the State of Delaware in and for New Castle County against Old
Learning Company and Old Learning Company's board of directors for alleged
breaches of fiduciary duties in connection with the May 1999 merger. The
six complaints were consolidated. The consolidated complaint named Mattel
as an additional defendant, claiming that Mattel aided and abetted the
alleged breaches of fiduciary duty. On March 9, 2000, the plaintiffs filed
a notice and order of dismissal dismissing the action without prejudice. On
March 13, 2000, the Court formally dismissed the action by entering the

MATTEL INC: Stockholders File Suits in CA and DE over Mismanagement
On October 25, 1999, a Mattel stockholder filed a derivative complaint on
behalf and for the benefit of Mattel in the Superior Court of the State of
California, County of Los Angeles. The complaint alleges that Mattel's
directors breached their fiduciary duties, wasted corporate assets and
grossly mismanaged Mattel in connection with Mattel's acquisition of
Learning Company and seeks both monetary and injunctive relief. On February
10, 2000, the Court dismissed the complaint with leave to amend. On March
10, 2000, Mattel and the other defendants entered into a stipulation with
the plaintiff staying the action.

On March 17, 2000, a Mattel stockholder filed a second derivative complaint
on behalf and for the benefit of Mattel in the Superior Court of the State
of California, County of Los Angeles. On March 27, 2000, a Mattel
stockholder filed a third derivative complaint on behalf and for the
benefit of Mattel in the Court of Chancery of the State of Delaware in and
for New Castle County. Both complaints generally allege that Mattel's
directors breached their fiduciary duties and grossly mismanaged Mattel in
connection with Mattel's acquisition of Learning Company. The complaints
seek both monetary and injunctive relief.

Mattel believes the purported class actions and derivative suits are
without merit and intends to defend them vigorously.

MATTEL INC: Stockholders Sue upon Announcement of Earnings Shortfall
Following Mattel's announcement on October 4, 1999 that it expected an
earnings shortfall at its Learning Company division in the third quarter of
1999, several of Mattel's stockholders filed purported class action
complaints naming Mattel and certain of its present and former officers and
directors as defendants. The complaints generally allege, among other
things, that the defendants made false or misleading statements that
artificially inflated the price of Mattel's common stock by overstating the
revenues and net income of Mattel, and its Learning Company division, and
by falsely representing that the May 1999 acquisition of Learning Company
would be immediately accretive to Mattel's 1999 and 2000 financial results.

Two additional purported class action complaints have been brought against
Mattel as successor to Learning Company and the former directors of
Learning Company on behalf of former stockholders of Broderbund Software,
Inc. ("Broderbund") who acquired shares of Learning Company in exchange for
their Broderbund common stock in connection with the Learning
Company-Broderbund merger on August 31, 1998. The complaints in those
actions generally allege that Learning Company misstated its financial
results prior to the time it was acquired by Mattel. The purported class
actions brought on behalf of Mattel and Broderbund stockholders are all
currently pending in the United States District Court for the Central
District of California.

PHONE FIRMS: Off the Hook on Chicago Telecom. Tax Suit Seeking Refund
Plaintiffs challenging the validity of a tax authorized by ordinance must
name the taxing municipality as a defendant in the lawsuit, the 1st
District Appellate Court ruled.

The panel upheld Cook County Circuit Judge Thomas P. Quinn's dismissal of a
two-count complaint filed on behalf of three cellular phone subscribers who
pursued a suit against their service providers. The plaintiffs sought a
refund for taxes paid under the Chicago Telecommunications Tax on incoming
calls from 1995 through 1997.

A judge granted the City of Chicago's motion to intervene in the case.

The appeals court panel initially released its decision in the case on
April 19 as an unpublished order under Illinois Supreme Court Rule 23. The
city then filed a motion asking the appeals court to publish its decision.

The city's motion said the ruling should be published because it
establishes a rule of law that was not clearly set forth in previous cases
decided by Illinois reviewing court: That suing the collector of a tax
authorized by an ordinance, instead of the municipality, is not the proper
way to litigate the legality of a taxing ordinance."

The Appellate Court granted the city's motion to publish the decision two
weeks ago.

This decision, if published, will make it clear to potential plaintiffs
that they must name the taxing municipality as a defendant if they bring
suit to challenge the validity of a tax ordinance," the motion continued.
Cases similar to this case have been filed and may be filed in the future."

Chicago lawyer Terrence P. Buehler, who represents the plaintiffs, said he
doesn't expect to ask the Illinois Supreme Court to review the appeals
court's decision. Instead, Buehler said, he and co-counsel in the case
likely will file a new lawsuit seeking class-action status and naming the
city as the defendant, but not including the phone companies.

A spokeswoman for the city's Law Department said attorneys there will
defend the constitutionality of the ordinance establishing the 5 percent
telecommunications tax on cell phone use for Chicago residents.

We would rather not be sued at all, of course," said Jennifer Hoyle. But if
there is going to be a challenge to this tax, we feel that it's appropriate
and necessary for the city to be a party to the litigation."

The lawsuit at issue was filed in the Circuit Court during 1997 on behalf
of plaintiffs Claudia E. McGuire, Santiago A. Durango and George Diamond
Steak House. The complaint maintained that from 1995 through 1997 the city
was allowed to tax only outgoing calls under the amended sections of the
city's telecommunications tax.

The defendants named in the suit were Ameritech Cellular Corp.,
Southwestern Bell Mobile Systems Inc., doing business as Cellular One of
Illinois, and MCI, doing business as Nova Cellular. The three companies
collected the taxes during the two-year period.

The complaint's first count charged that the defendants breached their
service contracts when they collected taxes on calls the plaintiffs
maintained were not covered under the city's ordinance. The second count
asserted that the defendants violated the Illinois Consumer Fraud and
Deceptive Practices Act by listing the challenged tax as a local tax" on
phone bills. The defendants also failed to identify the tax as the Chicago
Municipal Tax, which applies to outgoing and incoming calls billed to a
Chicago address, regardless of where the calls were made or received,
according to the lawsuit.

The phone company defendants then filed a motion to dismiss, which Quinn
granted, holding that no matter how it is framed, the basis of plaintiffs'
breach of contract claim is that the phone companies wrongfully charged
them a tax which was not due. As such, this action against the phone
companies cannot stand."

Quinn further found that the complaint failed to state a claim under the
Consumer Fraud Act. The judge also granted the city's motion to dismiss,
holding that the city's application of the challenged tax was
constitutional, the appeals court panel said.

The plaintiffs then appealed Quinn's dismissal of their complaint with
prejudice to the 1st District.

We ... do not believe that suing the collector of a tax authorized by
ordinance is the proper way to litigate the legality of a taxing
ordinance," Justice Robert Cahill wrote for the panel in the five-page

The panel added, We do not believe this consumer fraud theory is pled with
the particularity and specificity needed to withstand a motion to dismiss."

The justices said they did not need to address the city's constitutional
and statutory construction arguments included in its motion to dismiss.

Plaintiffs did not amend their complaint to state a cause of action against
or ask for relief from the city," the panel held. The issues raised by the
city are not properly before us on appeal."

Justices David Cerda and Warren D. Wolfson concurred in the opinion.

Mardell Nereim, an assistant Chicago corporation counsel, argued the case
before the appeals court. Helen E. Witt, a Kirland & Ellis partner
representing Ameritech, argued on the defendants' behalf before the panel,
Hoyle said.

Attorneys with Jenner & Block represented MCI, while Lord, Bissell & Brook
lawyers represented Southwestern Bell. The case is Claudia E. McGuire, et
al. v. Ameritech Cellular Corp., et al., No. 1-99-1462. (Chicago Daily Law
Bulletin, May 31, 2000)

POTASH CORP: 8th Cir Reverses Antitrust Claims in Conscious Parallelism
In a decision that should interest any producer or manufacturer in
price-sensitive markets where "conscious parallelism" occurs, the Eighth
Circuit Court of Appeals, sitting en banc, reversed a prior decision of a
panel of that same Court, and threw out class claims for illegal conspiracy
under 1 of the Sherman Act.

In Blomkest Fertilizer, Inc. v. Potash Corp. of Saskatchewan, the full
panel of the Eighth Circuit affirmed the district court's grant of summary
judgment against a class of plaintiffs alleging potash producers conspired
to fix prices. 203 F.3d 1028 (8th Cir. 2000). The en banc Blomkest majority
provoked a sharp dissent by five circuit judges that accused the majority
of requiring "direct evidence to withstand summary judgment in an antitrust
case." The underlying facts of Blomkest, coupled with the strong dissent,
call into question whether this decision sounds the death knell of
circumstantial proof of so-called "plus factors" as evidence of illegal
conspiracy, or should more appropriately be viewed as a product of weak
evidence of conspiracy given legitimate market conditions.

Potash, a mineral, is an essential fertilizer ingredient. Demand for potash
is inelastic, meaning potash consumers will neither buy less if the price
rises, nor buy more if the price drops. Thus, a producer who sells for more
than the rest of the market risks loss of market share.

The North American potash industry is an oligopoly, essentially consisting
of a small number of mostly Canadian producers. Until 1989, the government
owned the largest Canadian potash producer, Potash Corporation of
Saskatchewan Inc. ("PCS"). The majority noted that PCS held 38% of the
North American production capacity, and, as a governmental entity, "had no
mandate to maximize profits, and was not accountable to private owners,"
seeking instead to maintain employment and boost the local economy. The
lack of profit motive spelled disaster for PCS and other producers: PCS
suffered "huge" losses, causing the price of potash to fall to historic
lows in the 1980s. PCS was privatized in 1989, at which time it reduced
output and raised its prices.

Of similar interest was a 1986 complaint filed by American potash producers
with the U.S. Department of Commerce, in which Canadian producers were
accused of "dumping" potash in the United States. In 1987, the Commerce
Department ordered the Canadian companies to post bonds, but in 1988, it
negotiated a Suspension Agreement with the Canadian producers. The
agreement, still in effect when the majority rendered its opinion, set a
minimum price at which each Canadian producer could sell potash in the
United States. After the agreement, PCS raised its prices and market prices
rose to levels "markedly" higher than in the 1980s.

The issue splitting the Blomkest court revolved around what showing a party
must make to survive a summary judgment motion in an antitrust case. In the
mid-1980s, two U.S. Supreme Court decisions provided the standard for
evaluating Sherman Act 1 antitrust violations in the summary judgment
context. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S.
574 (1986); Monsanto Co. v. Spray-Rite Serv. Corp., 465 U.S. 752, 764
(1984). These decisions held that conduct consistent with both permissible
competition as well as illegal conspiracy does not, standing alone, support
an inference of antitrust conspiracy. Rather, in cases where a party
opposing summary judgment (usually the plaintiff) offers circumstantial
evidence of an antitrust conspiracy, it "must present evidence that 'tends
to exclude the possibility' that the alleged conspirators acted
independently." If the plaintiff fails to present such evidence, the court
should enter summary judgment in the defendant's favor.

The class in Potash relied on the theory of conscious parallelism to
support its antitrust conspiracy claim. But only in cases where certain
"plus factors" exist will a court infer an improper anticompetitive
agreement. The class offered three plus factors: (1) interfirm
communications between the producers; (2) acts by the producers allegedly
against their self-interest; and (3) an expert report purporting to show
the price of potash would have been substantially lower absent collusion.

The majority, however, found the evidence "far too ambiguous" to support an
inference of conspiracy. First, the price verifications between the firms
concerned completed sales, rather than future market prices. Second, the
possibility of independent action could not be excluded, considering the
oligopolistic market in which the producers operated. Third, the class had
only presented several dozen price-verification communications between the
firms for the seven-year period in question, although tens of thousands of
transactions would have occurred.

The court quickly dispatched the other two plus factors. It noted the
actions alleged to be against the producers' self-interest could also be
explained by an independent business justification. For instance, the
uniform participation in the Suspension Agreement with the Commerce
Department reduced uncertainty, eliminated the need to post substantial
bonds, and resulted in higher prices. As to the third plus factor, the
court discounted the expert testimony because the expert failed to take
into account the PCS privatization and the anti-dumping proceeding. Without
any plus factors, the court concluded the class failed to present evidence
of collusion between the potash producers.

The dissent, on the other hand, believed "the class has adduced abundant
evidence" of plus factors, most importantly, "significant evidence of
solicitations to enter a price-fixing agreement." The dissent noted the
exchange of price information between potash producers often occurred
between high-level executives responsible for pricing decisions. The
dissent also found persuasive the class's allegation that disclosing price
information in an oligopoly was against the producers' self-interest
because the practice of "shading" prices for individual consumers to
capture sales from a competitor relies on secrecy to avoid retaliation.
Exchanging price information about completed sales could, therefore, serve
the important purpose of catching "cheaters" in an oligopolistic market
conspiracy. In fact, the class had presented a potash executive's notes
that used the term "cheating" in connection with a "market correction"
program which the dissent inferred was a method of disciplining producers
who breached an earlier agreement. The dissent also criticized the majority
for glossing over the fact that prices rose dramatically after the alleged
cartel began operating and instead focusing on the slight decrease in
prices, which the dissent posited might be the result of cheating.

Although the dissent accused the majority of rejecting circumstantial
evidence of conspiracy and requiring direct evidence to withstand summary
judgment, the majority provided no such express statement, presumably
leaving intact the availability of resort to circumstantial evidence for
proof of illegal conspiracy. Thus, the Blomkest majority's decision places
two principles in tension. On the one hand, a plaintiff may rely on
circumstantial evidence to prove an illegal conspiracy; on the other, the
court appeared to assess the weight of the evidence - the quantum of proof
as opposed to the existence of a genuine issue of material fact. This
tension is relieved, however, when the evidence presented is considered in
light of Monsanto's admonition that it must "tend to exclude" the
possibility of independent action, and the actual market conditions
existing before the alleged collusive activity.

Clearly, the majority was unpersuaded that the evidence of plus factors
urged by the class tended to exclude the possibility of independent action.
For example, it gave no weight to the "smoking gun" memo relied upon by the
class, noting that while dozens of "high ranking officials" were deposed,
the memo had been used as an exhibit only once - with the witness
testifying that he did not receive it. Similarly, other evidence did not
exclude the possibility of independent action: the economic expert's report
failed to address the two most critical market factors, privatization and
dumping; the interfirm communications were infitesimal compared to the
total volume of transactions; and market forces the dissent viewed as
setting the stage for conspiracy prices were viewed implicitly by the
majority as a result of factors leading to unrealistically low prices
during the 1980s.

In the final analysis, perhaps Blomkest is best read in light of two recent
conscious parallelism decisions in which the Third and Ninth Circuit threw
out the plaintiffs' antitrust claims that were supported only by
circumstantial evidence of collusion. In re Baby Food Antitrust Litig., 166
F.3d 112 (3d Cir. 1999); In re Citric Acid Litig., 191 F.3d 1090 (9th Cir.
1999). Unquestionably, courts appear more willing to dispose of conscious
parallelism allegations without a trial if they are satisfied the evidence
shows independent pricing decisions. Accordingly, parties should consider
this increased willingness when litigating conscious parallelism cases.
(The Metropolitan Corporate Counsel, June, 2000)

SECRET SERVICE: Black Agents Claim Retaliation for Racism Lawsuit
Five black Secret Service agents, including one now assigned to protect
Vice President Al Gore, claimed last Thursday June 1 that they have been
targeted for reprisals since initiating a federal lawsuit that accuses the
agency of racial discrimination. The agents alleged that Secret Service
Director Brian Stafford has attempted to silence them by encouraging top
black supervisors to question their case.

Secret Service officials again denied carrying out discriminatory workplace
practices and said they have taken no unfair action against the black

The legal battle began in February, but the stakes were raised May 3, when
five current and five former agents filed a class-action lawsuit in U.S.
District Court.

The lawsuit alleged that most black agents historically have been frozen
out of promotions when they reached the notch below supervisory jobs. In
court papers, attorneys John P. Relman and David J. Shaffer alleged that
"each active Special Agent whose name appeared on the caption of this
action has suffered retaliation at the hands of Secret Service Management
for participating in this lawsuit and for raising concerns about the fair
treatment of African-Americans in the Secret Service."

John E. Turner, one of the two original plaintiffs in the case, said he was
transferred May 7 from a supervisory job to one with no management
responsibilities. Reginald G. Moore, the other original plaintiff, said he
again was passed over for promotion in the Dallas field office even though
he scored 98.57 out of a possible 100 points in his evaluation. Luther K.
Ivery, who helps protect foreign dignitaries, said he hadn't even joined
the lawsuit when a supervisor warned him against taking part.

Secret Service officials have countered with statistics pointing out that
two of the agency's seven assistant directors are black and so are the
heads of four of the agency's 11 largest field offices. (The News and
Observer (Raleigh, NC), June 2, 2000)

TOBACCO LITIGATION: Judge Warns against Dawdle; Fed Suit Moves Forward
Judge Gladys Kessler has set a ground rule for the federal government's
landmark lawsuit against Big Tobacco, which moves forward last Friday, June
2, in her courtroom: no lollygagging. Kessler, 62, has warned both sides
not to dawdle. But that doesn't guarantee a quick resolution of the case.
She has said it could go to trial in January 2003, if she agrees to let it
continue and if the next presidential administration does not withdraw it.

The two sides were to debate in court on June 2 on the tobacco industry's
motion to dismiss the U.S. lawsuit, which aims to reclaim billions of
taxpayer dollars spent to treat ill smokers. Her decision on dismissal,
however, could take months.

Kessler is no dream judge for cigarette makers, who are also battling a
class-action lawsuit in Miami. Appointed by President Clinton in 1994,
she's considered a pioneer of public-interest law and one of the more
liberal, pro-regulatory judges on the U.S. District Court here. She has
also refused to dismiss claims by labor union health funds against the
tobacco industry. That differs from most federal judges nationwide who have
considered the matter.

"On public policy grounds alone, the claims of the health funds need to be
heard," Kessler ruled in December. "It would be nothing short of
unconscionable to conclude that foreseeable wrongs of such magnitude and
moral culpability, if proven, must go unremedied because our legal system
deemed them unworthy of recognition."

Michael Spencer, the New York lawyer who argued on behalf of the union
health funds, says Kessler's ruling in that case "should be indicative" of
how she might rule in the federal government's case.

David Adelman, a tobacco industry analyst at Morgan Stanley Dean Witter,
says the union case suggests that she will not dismiss the federal case,
which he argues lacks merit. "The most significant thing about Judge
Kessler is that ruling," Adelman says. However, he adds, "It's certainly
possible another attorney general would drop this case."

Analysts note that Kessler did not side totally with the union health
funds. She granted tobacco industry motions to dismiss several of the 10

"There's not a soul in America who could predict what she'll do," says
Judith Lichtman, a Kessler friend since 1966 and president of the National
Partnership for Women and Families. Kessler helped found the group, which
opposes sex discrimination and was known until recently as the Women's
Legal Defense Fund.

"She's the most open-minded, thoughtful person I've ever met," Lichtman
says. "She's not predictable. She's not a knee-jerk anything. She calls it
as she sees it." Several long-time associates say Kessler is not afraid to
buck those who may seem to be her "natural" allies.

She's also not afraid of breaking ground. One of the few women in her
Harvard Law School class of 1962, she and two partners founded the first
public-interest law firm in Washington, D.C. At the George Washington
University, she taught one of the first law school courses on women's
rights. In 1983, the Women's Bar Association named her "Woman Lawyer of the

"She has a very pleasant exterior but is tough-minded and tenacious," says
Susan Hoffman, a Washington lawyer who argued many child abuse and neglect
cases before Kessler when she was a Superior Court judge. Hoffman says
Kessler is distinctive for another reason: "She believes strongly in

Lawyers who know her expect that she would eventually nudge the two sides
in the federal case toward settlement. Kessler declined an interview.

The two sides appear in no mood for negotiation. The Justice Department's
complaint against nine tobacco companies, filed in September, alleges that
tobacco executives engaged in fraud and racketeering by conspiring for 45
years to conceal the risks of smoking. The suit seeks damages worth
potentially hundreds of billions of dollars and a court order barring the
industry from making misleading claims.

The industry argues that the lawsuit ignores the marketing restrictions and
other sanctions it agreed to as part of its 25-year, $ 206 billion
settlement with 46 states in November 1998. It argues that the government
has no explicit legal statute to recover Medicare costs. It also says
cigarette warning labels, required since 1966, show that tobacco's health
risks have long been known.

Kessler, known to be hard-working and conscientious, is a stickler for
courtroom rules. She hasn't been known to go especially fast on some cases.

Aware of, but not daunted by, the federal case's significance, she seems
determined to meet her own timetable. "One way or another, we're going to
keep this case on track," she told the lawyers at a November hearing. "The
massive nature of this case is not going to be an excuse for any lawyers
(or for) any delay. . . . There's not going to be any lollygagging." (USA
Today, June 2, 2000)

W.R. GRACE: Agrees to Settle MD Plant Workplace Sexual Harassment Suit
W. R. Grace & Company said on June 1 that it would pay $850,000 to settle a
lawsuit in which the United States Equal Employment Opportunity Commission
charged managers at a Maryland food-processing plant with egregious sexual
harassment of 22 female workers from Central America.

The commission said four plant managers and two nonsupervisors had engaged
in systemic harassment that included exposing themselves, demanding oral
sex and touching workers' breasts, buttocks and genital areas. Commission
officials said that the harassment had lasted four years and that there had
been one case of rape. "This stuff was pretty bad, and it seemed to be
pervasive, all over this large plant," said Regina Andrew, one of the
lawyers at the commission's Baltimore office who handled what became a
class-action lawsuit. "This was one of the worst sexual harassment cases
we've seen."

The commission said numerous women at the plant in Laurel, Md., were given
menial or difficult work assignments after they rejected the managers'
sexual demands. Commission officials said that two pregnant women who
rebuffed advances were subsequently fired and that managers would often
drive female workers home late at night, after the buses had stopped
running and would then expose themselves or pressure the women for sex.

"This case sends a clear message that wholesale violations of the civil
rights of the most vulnerable work force -- immigrant women in low-wage
jobs -- will not be tolerated," said Ida L. Castro, chairwoman of the

In a news release, Grace noted that it sold the plant in March 1996, a
month before four workers first complained to the commission. The company
said none of the accusations involved any member of Grace's management or
any current employee. "We are settling this case because we think it is in
the best interests of our employees and our shareholders to put this matter
behind us," the company said. "Grace has in place a very strong policy
prohibiting sexual harassment."

In March 1996, Grace, which is based in Columbia, Md., sold the plant to
Townsends Inc., which operated the plant until it was closed in April. The
plant made a wide variety of processed foods including soup, cheesecake and
poultry dishes. As part of the settlement, Townsends, which is based in
Wilmington, Del., agreed to pay $150,000. Barry Willoughby, a lawyer for
Townsends, said that even though the harassment was before Townsends bought
the plant, Townsends dismissed two managers and demoted two other workers
after investigating the matter. He said Townsends also posted sexual
harassment notices in English and Spanish. Mr. Willoughby said Townsends
agreed to pay 15 percent of the overall liability.

Commission officials said that after the first four women lodged a
complaint in April 1996 investigators found that the problem was far more
widespread, prompting the commission to bring the case as a class-action
lawsuit. (The New York Times, June 2, 2000)


S U B S C R I P T I O N  I N F O R M A T I O N

Class Action Reporter is a daily newsletter, co-published by Bankruptcy
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Washington, DC. Theresa Cheuk, Managing Editor.

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